The cycle of legislative acts that forms the basis for radical reforms in the field of healthcare was closed with the adoption of the Health Establishments Act (1999) together with the preceding Health Insurance Act (1998), The Professional Organizations Act (1998) and the Pharmaceuticals and Human Medicine Pharmacies Act (1995).

Which are the main points of the health reform?

Change of property

The legal framework and the rules for change of the bigger part of the health establishments form public state and municipality owned into private state and municipality owned was defined by the Health Establishments Act. With the change of property over health establishments and their transformation in full-fledged market subjects there emerge possibilities to receive own incomes out of medical activities. For example, one can lend medical offices (at the legally limited minimal rate of 1/10 of the common municipal or state rate) and equipment to privately practicing medical specialists, medical co-operations or trade partnerships having one single scope of activity - medical servicing; one can carry out privatization transactions. In this way possibilities are created for the attraction of private capitals and private undertaking in public healthcare.

The transformation of property over health establishments and the inclusion of health insurance payments against effectuated health services under contracts with the Regional Health Insurance Funds open possibilities to create a large regulated market between public and private equally placed market subjects.

Privatization of outpatient care

Private individuals or legal bodies carry out starting 1 July 2000 the outpatient care (with the exception of emergency care) - very much like the organization of the health systems in other countries. The objective is to set into motion the existing economic instruments of competition, private undertaking and private property which will result in a better quality of servicing of the insured persons and more successful management of the health establishments resources.

Building of "General Practitioner" institution

The health reform relies to a great extent on the building of a new institution in the outpatient care - that of the General Practitioner (GP). In contrast to the up to now existing district doctor the General Practitioner has private property over the health establishment and is directly interested in the outcome of its own activities. The patients in the municipality limits have chosen him according to their own wish and his income depend on whether the patients are satisfied with his professional level of performance and his attitude to them. The GP acts according to a defined package of activities in which an important place take health promotion and health prophylaxis, orientation of the activity towards the national health priorities.

Transformation of sources for curative medical care financing

Starting 1 July 2000 the financing of curative medical care by the National Health Insurance Fund came into force. The health insurance financing by the NHIF in 2001 becomes a main way to finance the hospital establishments as well. According to the Health Insurance Act hospital establishments are equally placed counterparts, irrespective of the nature of the property they own. The new dominating source of financial resources will replace financing out of taxes for nearly 90% of the hospital establishments (in the current health expenditures part).

The allocated budget of the NHIF for health insurance payments during the second half of the year 2000 amounted to 187 mln.lv. and brought about a better GNP/health expenditures relative ratio of 4,5% (up to then and after 1994 - 3%-4,3%) as well as a more realistic financing of the curative establishments for outpatient care. Another source for financing of the healthcare providers is the consumer tax according to Art. 37 of the Health Insurance Act amounting to 1% of the minimal wage and payable with each visit to the doctor. A third source of financing of municipal and state owned curative establishments remains task subsidies and transfers from the state and municipal budgets for investment objectives, for execution of national and regional programs and other obligations according to the Health Insurance Act and the Hospital Establishments Act. Together with this, the role of the voluntary health insurance funds will grow as well, which, after the licensing procedure is over, will function according to the requirements of the Health Insurance Act. It is possible that the most solvent part of the populitation will prefer to use their services which will not revoke their obligation to pay the mandatory health insurance contributions.

Change of payment models of curative establishments

By introducing of health insurance relations it is possible to change as well the payment models of curative establishments, which up to now received their budget resources irrespective of the activities accomplished. Under the new conditions one can apply different models, known in the world as effective means for achievement of high quality servicing of the population and for improvement of the just distribution of the resources. The decision on the models chosen was adopted in signing the National Framework Contract 2000 between the NHIF and the professional organizations of the medical doctors and of the dentists.